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Food safety efforts benefit from enhanced risk management

Hazard analysis, risk-based prevention stressed in new law

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Food safety efforts benefit from enhanced risk management

While businesses await regulations for last year's Food Safety Modernization Act that gives the Food and Drug Administration the authority to order recalls, experts advise companies in the food industry to enhance their risk management efforts now.

“A key focus of the new law is hazard analysis and risk-based preventive controls,” said Leslie Krasny, a San Francisco-based partner with law firm Keller & Heckman L.L.P.'s food and drug practice.

An FDA fact sheet explains that the FSMA requires food-related businesses “to evaluate the hazards in their operations, implement and monitor effective measures to prevent contamination, and have a plan in place to take any corrective actions that are necessary.”

The FDA is required to establish “science-based” standards for the safe production and harvest of produce to minimize the risk of foodborne illnesses or death. The law also gives the FDA the authority to order food recalls rather than just advising companies to do so.

No date has been set for release of the rules.

Despite enactment last year of the FSMA, it does not introduce an entirely new system for the food industry, said food microbiologist James S. Dickson, a professor in the animal science department of Iowa State University in Ames.

The FDA has reviewed what has been learned since the seven risk management principles of the Hazard Analysis & Critical Control Point system became the standard 15 years ago, Mr. Dickson said. Those standards have been mandatory only for meat, juice and seafood, but most of the industry has implemented them voluntarily, experts say.

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With the focus on prevention rather than just responding to foodborne illness outbreaks, the law “places primary responsibility on the industry. These highly technical risk assessments and evaluations of preventive controls require scientific experts,” said Ms. Krasny, who works with food industry companies on regulatory compliance and liability exposure issues. Companies must make sure they have such experts on board, she said.

Risk assessment, analysis and prevention should be hallmarks of food industry operations, according to Mr. Dickson. “If I had a brand reputation to protect or a percentage of the market to hang on to and grow, I wouldn't stop solely at what the regulations are,” he said.

But, he noted, even the experts can't eliminate risk. “Somehow there's got to be a balance between the regulatory side, the production side and the consumer side,” Mr. Dickson said. When dealing with produce and animal products, “zero risk is simply not attainable.”

For that reason, “the main thing a risk manager should be looking at is things they can control” when identifying a company's potential liability exposure, said William Marler, managing partner of Seattle-based Marler Clark L.L.P., which represents victims of foodborne illnesses. “Come up with a strategy to make sure your suppliers care about food safety.”

Wal-Mart Stores Inc. says it has done just that.

“Wal-Mart was the first U.S.-based grocery chain to require our suppliers to achieve factory certification using one of the Global Food Safety Initiative-benchmarked standards,” a spokeswoman for the Bentonville, Ark.-based company said in an email. “The traditional way of auditing suppliers was simply not meeting our expectations. We wanted an independent, unbiased approach for auditors to ensure our suppliers take food safety as seriously as we do. We must keep our suppliers and auditors accountable, so we can ensure our customers are getting safe food.”

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A company can protect its reputation and brands by following these steps, Mr. Marler said. “Arm yourself with good, current information. Be proactive. Make food safety part of everything you do. Treat customers with respect.”

He also suggests that food handlers be well trained, certified and have appropriate vaccinations.

In addition to identifying risks and developing and implementing a risk management plan, food industry companies must have sufficient insurance coverage and “make sure the policy provides the scope of coverage they want,” said Ms. Krasny. “Subtle differences in wording can have significant legal implications,” she said.

For example, if a company's recall turns out to be unnecessary based on subsequent information, some recall policies will not cover such losses. Under other policies, a reasonable belief that a recall was warranted would trigger the coverage, she said.

“Risk managers really need to pay attention to past foodborne illnesses to see which companies have been insured enough.” Mr. Marler said. “Then they should compare their risk profile to cases they've seen” to estimate the amount of coverage that is warranted.

Before signing an insurance contract, risk managers should make sure that the insurer will provide defense counsel with experience in food safety law, Mr. Marler said.

In addition to a food firm's own insurance coverage, “Make sure you are a named additional insured in your suppliers' insurance contracts,” Mr. Marler said.

Mr. Dickson, who is in charge of Iowa State's Food Safety Consortium, a research partnership including the University of Arkansas and Kansas State University, said much has been learned from foodborne illness outbreaks and improvements have been made.

“When the big outbreak of contaminated spinach happened in 2006, that was a big leap” in the food industry's commitment to tracking the sources and destinations of their products. “Incidents spur a lot of research in the industry,” Mr. Dickson said.

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